TMI Blog2023 (3) TMI 203X X X X Extracts X X X X X X X X Extracts X X X X ..... supra) has also considered an identical issue and held that Department cannot be permitted to avail of extended time limit, in absence of any new or tangible material. No counter judgement was cited by the Department except case law of the Hon'ble Supreme Court in the case of CIT Vs. P.V.S.Beedies Pvt.Ltd. [ 1997 (10) TMI 5 - SUPREME COURT] wherein the issue of audit objection how to be dealt with and whether that forms opinion or not is to be considered. Since, the Hon'ble Supreme Court in the case of CIT vs. Kelvinator of India [ 2010 (1) TMI 11 - SUPREME COURT] has considered this issue, reopening on the same set of facts, which were available in the original assessment proceedings which were examined by the Assessing Officer, is bad in law and hence, quashed - Appeal of the assessee is allowed. - I.T.A.No.1094/Chny/2022 - - - Dated:- 28-2-2023 - Shri Mahavir Singh, Vice-President For the Appellant : Mr. Mr. N.Arjunraj, C.A for Mr.S.Sridhar, Advocate For the Respondent : Mr. AR.V.Sreenivasan, Addl.CIT ORDER This appeal filed by the assessee is arising out of order of the Commissioner of Income Tax (Appeals), National Faceless Appeal Centre (NF ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ason to believe that income chargeable to tax for assessment year 2013-14, in this case, had escaped assessment, reopening was made u/s.147 of the Act after obtaining approval from the Additional CIT, Range-3, Trichy. According to him, reopening is valid and therefore, he proceeded to frame assessment on merits. 6. The Assessing Officer made addition on account of amount paid by the assessee of Rs.18.00 lakhs towards release of lease tenancy to Mr.E.Manickavel, who confirmed that he has received Rs.18.00 lakhs from Mrs.Seethalakshmi, the assessee, in order to release lease-holdings on the above said property. The facts are that the assessee purchased a vacant site admeasuring 17,859.60 sq.ft for a sum of Rs.27 lakhs. The Assessing Officer noticed that in the profit loss account as on 31.03.2013, the assessee has debited a sum of Rs.18.00 lakhs towards expenses on lease rights release on the above said property. According to the Assessing Officer, the assessee has filed copy of unregistered lease release deed dated 26.04.2013 entered into between seller and Mr. E.Manickavel stating that the assessee has received a sum of Rs.18.00 lakhs towards release of lease from the above sa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eceived from O/o Sub- Registrar, Thiruverumbur it is seen that the assessee has purchased a house property at 12-A Bharath Avenue, Pappakurichi, Thiruverumbur Tk for a sum of Rs.11,00,000/ on 23.7.2012. In the balance sheet as on 31.3.2012, the assessee has shown a sum of Rs.74,992/- as cash in hand and bank In the balance sheet as on 31.3.2013 the asessee has shown a sum of Rs.16,38,500/- in fixed assets. In view of the above. I have reason to believe that the income chargeable to tax for the assessment year 2013-14, in this case, has escaped assessment I. therefore, seek the approval of the Joint Commissioner of Income Tax. Range-3, Trichy, for reopening the assessment u/s.147 and to issue notice u/s 148 of the Income Tax Act, 196t to make assessment u/s/143(3) r.w.s.147. 7. Against confirmation of re-opening by the Assessing Officer, the assessee preferred appeal before the CIT(A). The CIT(A) also confirmed action of the Assessing Officer by observing in para 5.2.3 as under:- 5.23 I have carefully considered claim of the appellant. The appellant s apprehension that the notice would have been issued after 31.3.2018 is without any basis. The Assessing Officer has go ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... perusal of the details filed by the assessee during the course of scrutiny assessment proceedings, it is seen that letter addressed by Smt. Uma Devi, M.Sathiskumar, M.Sakthivel, M.Lakshmi Priya (sellers) dated NIL that they had received a sum of Rs.27 lakhs as sale consideration from the assessee in respect of the above property and also filed unregistered sale receipt dated 14.3.2013 stating that assessee had paid a sum of Rs.27 lakhs to the sellers and taken over possession as per POA registered with SRO, Thiruverumbur dated 14.03.2013. 10. Even the Assessing Officer from the details filed by the assessee during the course of scrutiny assessment proceedings, which was examined by the Assessing Officer during the course of original assessment proceedings and recorded this fact in the assessment order, it means that the Assessing Officer while issuing notice u/s.148 of the Act has no fresh or intangible material for reopening of assessment. The learned counsel for the assessee in view of the above stated that this issue has been considered by the Hon ble Madras High Court in the case of TANMAC India vs. DCIT. Circle-I, Pondicherry reported in (2017) 78 Taxmann.com 155 (Mad) in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 148 of the Income Tax Act taking advantage of the now extended limitation of four years to re- assess income on the basis of the same materials that were available with the authority as part of the record. 11. The phrase reason to believe in Section 147 relates to such other new or tangible material as may have come to the knowledge of the Assessing Officer pursuant to the original proceedings for assessment. The Supreme Court in the case of Commissioner of Income Tax Vs. Kelvinator of India [2010] 320 ITR 561 / 1867 Taxmann 312 states thus in the context of the belief that should form the basis for a re-assessment. We must also keep in mind the conceptual difference between power to review and power to reassess. The Assessing Officer has no power to review, he has the power to reassess. But reassessment has to be based on fulfillment of certain preconditions and if the concept of change of opinion is removed, as contended on behalf of the Department, then, in the garb of reopening the assessment, review would take place. One must treat the concept of change of opinion as in-built test to check abuse of power by the Assessing Officer. Hence, after 1st April, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ights release amounting to Rs.18.00 lakhs which is to be disallowed u/s.40A(3) of the Act and added to the returned income, the same constitute new information. He relied on decision of the Hon'ble Supreme Court in the case of CIT Vs. P.V.S.Beedies Pvt.Ltd. reported in (237 ITR 13) (SC). The learned Senior DR also filed audit objection raised by the Revenue. 12. I have heard rival contentions and gone through facts and circumstances of the case. I noted that from the very reasons recorded, it is clear that the Assessing Officer has simplicitor gone into assessment records and whatever information filed during assessment proceedings, the Assessing Officer has made basis for reopening of assessment. Admittedly original assessment was completed u/s.143(3) of the Act and the Assessing Officer has examined issue of lease rights release of Rs.18.00 lakhs. I find that this issue has been considered by the Assessing Officer in the original assessment and relevant para 6 of assessment order is already re-produced above in para 8 of this order. I find that the Hon'ble Madras High Court in the case of TANMAC India Vs. DCIT (supra) has considered this issue in detail and noted that ..... X X X X Extracts X X X X X X X X Extracts X X X X
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